Health Insurance: How Much Is Enough?

by Alicia Isero

How much coverage do you need? Well…it depends. Are you young, healthy, and a beacon of safety, or are you over 65, a smoker, and race cars for a living? When shopping for a health insurance policy--or upgrading a current policy--knowing and understanding all your options can pay tremendous dividends. Making an uninformed decision, however, can lead to unnecessary or overpriced coverage, or even a lack of appropriate coverage if you or a family member suffers a crippling injury. Therefore, when making any health insurance policy decisions, consider each of the following things first:

Age. People assume the younger you are, the less insurance you need because many illnesses seem to affect the elderly. Wrong! Insurance is something you purchase to protect yourself and your family from an unlikely event. Illness, disease, or an accident can strike at any age. Babies visit the doctor monthly; children have annual wellness visits, schools and sports teams require regular check ups each season, adult women have regular tests and check ups, and during pregnancy, weekly and monthly appointments.

Family Status. It is important for children (as outlined above) to have health coverage. If you are a couple considering children, insurance is critical for both mother and baby.

Genetics/Family History. Do you have chronic disease in your bloodline? There are a number of health issues that commonly run in the family (diabetes, alcoholism, cancer, high blood pressure, and heart or kidney disease). If prone to a chronic condition, it is important to have health benefits that would cover preventative care as well as treatment.

Chronic conditions. If you already suffer from a chronic condition, the cost of regular treatment without insurance can add up quickly. Health coverage through an employer, alumni association, or trade union may be your best bet.

Frequency. Depending on your age and health status, consider how often you visit the doctor's office. If you have a job or hobby that constantly puts you in danger, for example, or that takes a tremendous physical toll on your body, keep that in mind as well.

Choosing a Health Insurance ProviderOnce you've answered a few questions about you and your family, find out what coverage options are available. For example, many people are covered by their employer or their spouse's employer. Many individuals under 25 are covered by their parents' health insurance. You may also find coverage via the Federal government, school policies, trade unions, and alumni associations. Even some cities now have coverage options for residents. All may be viable options, but some entities offer more complete coverage than others. Find out exactly how much coverage you'll need, and then narrow down your options from there.

Insurance Dollars and SenseAs soon as you have two or three choices in mind, it's time to think about your finances. In other words: premiums and co-pays. Insurance premiums are the payments you make to your provider in return for coverage, usually on a monthly basis. Premiums vary depending on type of coverage (HMO, PPO, etc.), who is covered, and how much coverage you've purchased. These factors also determine the amount of your co-pay--the fee you pay for a trip to the doctor or, God forbid, to the emergency room. A majority of healthcare policies call for co-pays between $10 and $40. Plans with lower monthly premiums, however, often come with higher co-pays, and vice versa.

Other Things to Consider When Shopping for a Policy

Choice of doctors. If you always see the same doctor, make sure that doctor is available under the plan you choose. Perhaps you want certain specialist, make sure that name is on the list.

Locations. Are the doctors and services you want, located close to your home?

Patient volume. In order to see the doctor, do you have to wait hours? Or does it take months to get an appointment?

No one likes to pay for health insurance. It's a fact of life. But so is the need for medical care. Though you don't like to think about it, someone in your family--perhaps even you--will need to see the doctor or go to the hospital. To make sure you have the health coverage you need, know your options, research each one carefully, and choose the policy that best fits the lifestyle of you and those around you.